Asian Paints Ltd. share price target

The Board of Directors of Asian Paints Ltd approved the recommendation of payment of final dividend of Rs. 1.50 (Rupee one and paise fifty only) per equity share of the face value of Rs. 1 (Rupee one) each for the financial year ended 31st March, 2020, subject to approval of the shareholders at the ensuing 74th AGM. The dividend, if approved by the shareholders will be...

due to Covid 19 impact. APNT has started safe painting campaign and expects labor to return once normalcy is restored. However, slowdown in real estate and guidelines on construction activity will impact sales in near term. Despite near term challenges, we remain positive in the structural growth story due to 1) product portfolio straddling across price points 2) huge scope in entry level paints given deep distribution (2x nearest competitor) and 3) success of new products at 15-20% lower prices. We marginally tweak our estimates given low input costs and lower dividend and capex and estimate...

The domestic paint industry has grown strongly by ~12% in the last 10 years despite various macro challenges like demonetisation, introduction of GST, floods in various states, volatility in input prices. Major paint players like Asian Paints, Berger Paints and Kansai Nerolac have been seen to have bounced back strongly supported by 1) India's long term growth drivers staying intact, 2) strong supply chain networks, 3) higher promotional spends, 4) pan India dealer reach, 5) strong management. Considering the gradual relaxation from lockdown (as of now ~76% districts either in orange...

Healthy cash flow stocks to buy in Covid19 correction

Our interaction with managements and dealers indicates significant prebuying activity of consumer goods during January-February 2020 on fears of supply related issues from China. While companies have secured supplies to avoid any disturbance in sales in Q4FY20, demand was negatively impacted in March 2020 owing to holiday and post that lockdown across countries. We also believe a late recovery in demand for consumer goods will also impact Q1FY21 performance due to 1) shortage of workers (due to heavy migration), 2) shift in focus on essential goods compared to discretionary products and 3) streamlining of supply chain....

Our interaction with managements and dealers indicates significant prebuying activity of consumer goods during January-February 2020 on fears of supply related issues from China. While companies have secured supplies to avoid any disturbance in sales in Q4FY20, demand was negatively impacted in March 2020 owing to holiday and post that lockdown across countries. We also believe a late recovery in demand for consumer goods will also impact Q1FY21 performance due to 1) shortage of workers (due to heavy migration), 2) shift in focus on essential goods compared to discretionary products and 3) streamlining of supply chain....

APNT delivered a weak performance for second quarter in a row especially on revenue front as it report a 3% YoY growth in revenues despite ~10% volume growth, mainly due to mix deterioration (higher focus on economy segment products and weak growth in premium products).

December 2019 compared to corresponding previous year period. The company operating margins rose 90 bps to 21.9%. As a result operating profit growth rose 8% to Rs 1189.39 crore. Cost of raw material consumed as a percentage of net sales (net of stock adjustment) fell 560 bps to 45.6% while purchase of stock in trade rose 140 bps to 8.3%, employee benefit expense rose 70 bps to 6.8% and other expense increased 140 bps to 15.8%....

Asian Paints Limited is an Indian multinational paint company headquartered in Mumbai, Maharashtra. The company is engaged in the business of manufacturing, selling and distribution of paints, coatings, products related to home decor, bath fittings and providing...